Big news coming out of the traveltech space here in India. A consolidation of gargantuan proportions sees MakeMyTrip acquiring Ibibo Group.
Ibibo as an umbrella company comprises bus aggregator – redBus and ride collaborator – Ryde. Combining this with MMT’s stays aggregator – Rightstay will result in the combined entity having widespread capabilities and a big chunk in the Indian traveltech space. The bunch of companies together made over 34 Mn transactions in the previous financial year.
The Ibibo group, which is owned by Naspers (91% stake) and Tencent (9% stake), is being sold in full, in consideration of issuance of new shares by MakeMyTrip. Naspers and Tencent will remain the largest shareholders in the resulting company with a combined 40% stake.
The third big player in this acquisition is Ctrip.com International Ltd., who had purchased 5-year convertible notes issued by MMT for $180 Mn earlier this year. They will eventually own 10% stake in the company. This will result in Ctrip having approximately 10% stake in the entity once the transaction closes in December 2016 following formal approvals from regulatory authorities and MMT shareholders.
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Chairman and Group CEO of MakeMyTrip, Deep Kalra said, “Today’s announcement is a significant step forward for the rapidly growing travel industry in India. We expect this deal to create an even more scalable business with the expertise to transform the booking experience for Indian travellers. I am delighted to be leading such a strong team in our next chapter of high-growth in this dynamic industry.”
MMT’s founder Deep Kalra will remain Group CEO and Executive Chairman of MakeMyTrip and co-founder Rajesh Magow will maintain his position as CEO India of MakeMyTrip. Ashish Kashyap, founder and CEO of Ibibo Group will join the combined entity’s executive team as a co-founder and will hold the position of President in the company.
Commenting on the developments, Ashish Kashyap said, “Since I founded ibibo in 2007, we have innovated and grown to become one of the leading travel companies in India, providing solutions not just for travellers, but for suppliers too. Deep, Ramesh, and I saw a great opportunity to join forces, and I am excited that this merger enables all of us to continue a great journey together as the leading travel group in India.